Stock Analysis on Net
Stock Analysis on Net

Philip Morris International Inc. (NYSE:PM)

Analysis of Goodwill and Intangible Assets

Microsoft Excel

Goodwill and Intangible Asset Disclosure

Philip Morris International Inc., balance sheet: goodwill and intangible assets

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Goodwill 16,779 19,655 6,680 5,964 5,858
Non-amortizable intangible assets 4,543 3,346 1,312 1,289 1,319
Trademarks 2,267 2,050 1,201 1,233 1,217
Developed technology, including patents 774 975 859 93 —
Customer relationships and other 3,843 1,390 238 126 219
Amortizable intangible assets, gross carrying amount 6,884 4,415 2,298 1,452 1,436
Accumulated amortization (1,563) (1,029) (792) (722) (642)
Amortizable intangible assets, net 5,321 3,386 1,506 730 794
Other intangible assets, net 9,864 6,732 2,818 2,019 2,113
Goodwill and other intangible assets, net 26,643 26,387 9,498 7,983 7,971

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Goodwill Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Philip Morris International Inc. goodwill increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.
Other intangible assets, net Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Philip Morris International Inc. other intangible assets, net increased from 2021 to 2022 and from 2022 to 2023.
Goodwill and other intangible assets, net Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. Philip Morris International Inc. goodwill and other intangible assets, net increased from 2021 to 2022 and from 2022 to 2023.

Adjustments to Financial Statements: Removal of Goodwill

Philip Morris International Inc., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Adjustment to Total Assets
Total assets (as reported) 65,304 61,681 41,290 44,815 42,875
Less: Goodwill 16,779 19,655 6,680 5,964 5,858
Total assets (adjusted) 48,525 42,026 34,610 38,851 37,017
Adjustment to Total PMI Stockholders’ Deficit
Total PMI stockholders’ deficit (as reported) (11,225) (8,957) (10,106) (12,567) (11,577)
Less: Goodwill 16,779 19,655 6,680 5,964 5,858
Total PMI stockholders’ deficit (adjusted) (28,004) (28,612) (16,786) (18,531) (17,435)
Adjustment to Net Earnings Attributable To PMI
Net earnings attributable to PMI (as reported) 7,813 9,048 9,109 8,056 7,185
Add: Impairment of goodwill 665 — — — —
Net earnings attributable to PMI (adjusted) 8,478 9,048 9,109 8,056 7,185

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Philip Morris International Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Philip Morris International Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Net Profit Margin
Reported net profit margin 22.21% 28.49% 29.00% 28.08% 24.11%
Adjusted net profit margin 24.10% 28.49% 29.00% 28.08% 24.11%
Total Asset Turnover
Reported total asset turnover 0.54 0.51 0.76 0.64 0.70
Adjusted total asset turnover 0.72 0.76 0.91 0.74 0.81
Financial Leverage
Reported financial leverage — — — — —
Adjusted financial leverage — — — — —
Return on Equity (ROE)
Reported ROE — — — — —
Adjusted ROE — — — — —
Return on Assets (ROA)
Reported ROA 11.96% 14.67% 22.06% 17.98% 16.76%
Adjusted ROA 17.47% 21.53% 26.32% 20.74% 19.41%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by revenue. Philip Morris International Inc. adjusted net profit margin ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Philip Morris International Inc. adjusted total asset turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Philip Morris International Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.

Philip Morris International Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net earnings attributable to PMI 7,813 9,048 9,109 8,056 7,185
Net revenues 35,174 31,762 31,405 28,694 29,805
Profitability Ratio
Net profit margin1 22.21% 28.49% 29.00% 28.08% 24.11%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted net earnings attributable to PMI 8,478 9,048 9,109 8,056 7,185
Net revenues 35,174 31,762 31,405 28,694 29,805
Profitability Ratio
Adjusted net profit margin2 24.10% 28.49% 29.00% 28.08% 24.11%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Net profit margin = 100 × Net earnings attributable to PMI ÷ Net revenues
= 100 × 7,813 ÷ 35,174 = 22.21%

2 Adjusted net profit margin = 100 × Adjusted net earnings attributable to PMI ÷ Net revenues
= 100 × 8,478 ÷ 35,174 = 24.10%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by revenue. Philip Morris International Inc. adjusted net profit margin ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Total Asset Turnover

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net revenues 35,174 31,762 31,405 28,694 29,805
Total assets 65,304 61,681 41,290 44,815 42,875
Activity Ratio
Total asset turnover1 0.54 0.51 0.76 0.64 0.70
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Net revenues 35,174 31,762 31,405 28,694 29,805
Adjusted total assets 48,525 42,026 34,610 38,851 37,017
Activity Ratio
Adjusted total asset turnover2 0.72 0.76 0.91 0.74 0.81

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Total asset turnover = Net revenues ÷ Total assets
= 35,174 ÷ 65,304 = 0.54

2 Adjusted total asset turnover = Net revenues ÷ Adjusted total assets
= 35,174 ÷ 48,525 = 0.72

Activity ratio Description The company
Adjusted total asset turnover An activity ratio calculated as total revenue divided by adjusted total assets. Philip Morris International Inc. adjusted total asset turnover ratio deteriorated from 2021 to 2022 and from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets 65,304 61,681 41,290 44,815 42,875
Total PMI stockholders’ deficit (11,225) (8,957) (10,106) (12,567) (11,577)
Solvency Ratio
Financial leverage1 — — — — —
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted total assets 48,525 42,026 34,610 38,851 37,017
Adjusted total PMI stockholders’ deficit (28,004) (28,612) (16,786) (18,531) (17,435)
Solvency Ratio
Adjusted financial leverage2 — — — — —

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Financial leverage = Total assets ÷ Total PMI stockholders’ deficit
= 65,304 ÷ -11,225 = —

2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total PMI stockholders’ deficit
= 48,525 ÷ -28,004 = —

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net earnings attributable to PMI 7,813 9,048 9,109 8,056 7,185
Total PMI stockholders’ deficit (11,225) (8,957) (10,106) (12,567) (11,577)
Profitability Ratio
ROE1 — — — — —
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted net earnings attributable to PMI 8,478 9,048 9,109 8,056 7,185
Adjusted total PMI stockholders’ deficit (28,004) (28,612) (16,786) (18,531) (17,435)
Profitability Ratio
Adjusted ROE2 — — — — —

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROE = 100 × Net earnings attributable to PMI ÷ Total PMI stockholders’ deficit
= 100 × 7,813 ÷ -11,225 = —

2 Adjusted ROE = 100 × Adjusted net earnings attributable to PMI ÷ Adjusted total PMI stockholders’ deficit
= 100 × 8,478 ÷ -28,004 = —

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net earnings attributable to PMI 7,813 9,048 9,109 8,056 7,185
Total assets 65,304 61,681 41,290 44,815 42,875
Profitability Ratio
ROA1 11.96% 14.67% 22.06% 17.98% 16.76%
Adjusted for Goodwill
Selected Financial Data (US$ in millions)
Adjusted net earnings attributable to PMI 8,478 9,048 9,109 8,056 7,185
Adjusted total assets 48,525 42,026 34,610 38,851 37,017
Profitability Ratio
Adjusted ROA2 17.47% 21.53% 26.32% 20.74% 19.41%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROA = 100 × Net earnings attributable to PMI ÷ Total assets
= 100 × 7,813 ÷ 65,304 = 11.96%

2 Adjusted ROA = 100 × Adjusted net earnings attributable to PMI ÷ Adjusted total assets
= 100 × 8,478 ÷ 48,525 = 17.47%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Philip Morris International Inc. adjusted ROA deteriorated from 2021 to 2022 and from 2022 to 2023.